Paul Scarr (Queensland, Liberal Party) Share this | Hansard source

Whenever I follow a Greens senator who has talked about economics and about supply and demand, I refer to my book on basic economics to see what that tells me about supply and demand issues. Senator Thorpe seems to think this is not a supply issue. It absolutely is a supply and demand issue. What happens when you constrain supply? When you constrain supply, prices go up. It is economics 101: when you constrain supply, prices go up. That is what we have seen in the Australian gas market. It is basic economics 101: you constrain supply and prices go up.

The tragedy of this situation is that Australia has an ample supply of gas. It's just a question of getting it out of the ground and getting it to market. That is where there has been a failure of state governments, in particular the state government of Victoria. With respect to that, in that context, it is so disappointing to hear the rhetoric coming from some government ministers in the other chamber. In particular, I refer to the comment made by the Minister for Industry and Science, Mr Ed Husic, and quoted in an article by the great political editor of the AFR, Phillip Coorey. The article is entitled 'Labor, unions rupture over gas prices'. Minister Husic said:

It's team Australia or team greed—the choice is up to the gas companies.

That's what he said. He cast a general slur upon all of those companies, including great Queensland companies, which spend millions and millions of dollars on gas exploration, having invested in important infrastructure in places such as Gladstone, in my home state of Queensland. 'It's all about team Australia or team greed.' That's what the minister says. He casts a general slur over those involved in the oil and gas industry.

I ask, through you, Mr Acting Deputy President Smith, where was the minister for industry when those companies were struggling with gas prices near the floor and were writing off billions in investment and incurring billions and billions in losses? Where was his 'team Australia or team greed' rhetoric? Nothing. Crickets. Absolutely nothing. But now the market has turned he wants to cast a slur on the gas companies. What he should be looking at is the state government of Victoria and how it has not taken the action necessary to increase gas supply in the east coast market.

I want to quote from an op-ed piece written by Mr Ian Davies, who actually is involved in the gas industry and knows something about the gas industry. I think this article, which appeared in the AFR a month or so ago, contains all you need to know about this argument. He says:

The key to reducing the gas price is to unlock the upstream industry's potential to deliver more gas …

That's the key. This is a supply issue. The gas is there in the ground. We need to get it to market. That's the key. And again I quote from this outstanding op-ed:

Simply blaming upstream gas suppliers for all of the economy's woes is not only wrong, it is cynical, political and lazy.

That's what Mr Davies says. He is involved in the gas industry and has been for a long period of time. That's the response to the slurs from the minister for industry who invokes greed et cetera instead of looking at the underlying cause, and the underlying cause is a lack of supply.

The Narrabri Gas Project in New South Wales could provide half the market of gas for residents and businesses in New South Wales, but it's taken 10 years and more; we're still waiting for that gas project to come online. That's the issue. It's an issue of supply. Those opposite—ministers in this government—are engaging in this rhetoric, which I refer to as cynical, political and lazy. They're demonising the gas industry, instead of looking at ways supply can be increased.

I will end with this quote from Mr Davies's article:

We are a sophisticated and wealthy nation with sophisticated and complicated markets. Let's act like it.